Public expenditure and economic growth in Algeria
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Date
2019
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Publisher
University of Oum El Bouaghi
Abstract
The objective of this paper is to determine the causal relationship between government expenditure and economic growth in Algeria during the period 2000-2016. The paper Based on testing the extent to which Wagner’s law matches the Algerian economy, the result shows that public expenditure is growing more rapidly than the growth of Gross Domestic Product. The paper provides empirical insights on whether individual spending can be seen as an indicator of the state of economic growth in Algeria during the period 2000-2016. Because of the chosen research approach, the research results may lack generalisability. Therefore, researchers are encouraged to test the proposed propositions further. Consequently, Algerian economy does not match the Wagner’s law. Therefore, the public expenditure must be adjusted at a rate equal to the development of GDP.
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Keywords
Economic growth, Public expenditure, Wagner’s law, GDP